The Institute of Practitioners in Advertising's latest Bellwether survey of marketing spend among the UK's top advertisers shows 18.2% of companies increased internet marketing budgets during the third quarter of the year, while only 4.7% cut their spend.
The number of companies allocating no marketing spend to internet-related activity fell to a six-quarter low of 26%. The proportion of firms that allocated at last 10% of their total marketing budget to internet spend has risen from 4% to 7% over the past year.
Internet and direct marketing were the only sectors to buck a continued downward trend in marketing spend, with overall budgets reduced for the fifth consecutive quarter -- 21% of firms said budgets had been revised down.
For the first time in the report's history, however, there was no severe downward budget adjustment in the second quarter. The IPA puts this down to budgets already having been adjusted in the second quarter due to the conflict in Iraq, and to a mood of greater optimism.
Stephen Woodford, president of the IPA, said: "We are very encouraged by this report especially since the previous two years' third-quarter results seemed to suggest that we should probably expect a severe adjustment downwards as companies prepare their figures for year end."
Report author Chris Williamson said: "This third-quarter report is in line with other cautiously optimistic industry forecasts and suggests that we will see firm signs of a recovery in marketing and advertising expenditures as we move into the new year."
WPP chief executive Sir Martin Sorrell added that his experience reflected the report findings: "The UK remains our toughest target, although the rate of decline is slowing and prospects for next year look better."
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